histofthought1

Mercantilism andfreedom in Englandfrom the Civil War to 1750 327But it was Dudley's brother Roger who took the final step, not only inexplaining his brother's methodology, but also in expounding consistentlaissez-faire conclusions. Attacking government intervention across the board,Roger North declared:There can be no trade unprofitable to the public, for if it prove so, men leave off;and wherever the trades thrive, the public, of which they are part, thrives also. Nolaw can set prices in trade, the rates of which must and will make themselves. Butwhen such laws do happen to lay any hold, it is so much impediment to trade...All favour to one trade or interest against another is an abuse...Therefore, concluded Roger, 'Laws to hamper trade, whether foreign ordomestic, relating to money or other merchandises, are not the ingredients tomake a people rich... 'What can government do for a prosperous economy? 'If peace be procured,easy justice maintained, the navigation not clogged, the industriousencouraged...' in short, wrote North: 'It is peace, industry and freedom thatbrings trade and wealth, and nothing else' .2611.5 The inflationistsIt is not surprising that mercantilists, with their concentration on greaterrevenues and power to the state, should fasten on inflationist schemes ofcreating bank paper and credit, as well as government paper money. Suchproposals and schemes, however, had to wait for the discovery of printing inthe fifteenth century, for the development of bank paper and fractional reservesin sixteenth century Italy, and finally, for the invention of governmentpaper money and central banking, both dubious innovations of Britain in the1690s.The first English inflationist was William Potter, whose most famous tractwas The Key of Wealth (1650). It was Potter whose theories and proposedschemes set the stage for more famous inflationist followers, such as theScotsman John Law. Potter, who worked in the government land office,began with the generally agreed axiom that a greater amount of money isbeneficial to society. But with impeccable logic, Potter asked: if more moneyis good, why shouldn't a perpetual and greater increase of money be evenbetter? Why indeed? Why not an increasing supply of money leading toinfinity?Potter offered a plethora of money-creating schemes, in which paper moneywould be secured, not by specie, which is inconveniently scarce, but by the'nation's land'. More relevantly, of course, paper notes can actually be redeemedin physical gold or silver coin, whereas redemption of notes 'in land'would prove a chimera. How are you supposed to carry around a few acres ofland with you to make exchanges? But that of course is the idea of a 'land